The Food Biz Episode 10 Recap: Making Sense of the Markets with Darin Newsom

On this week’s episode of The Food Biz, hosts Kristyn Tarpey and Ryan Nelson are joined by Darin Newsom, a seasoned market analyst, commentator, and Founder of Darin Newsom Analysis. The three discuss some of the market movements, Darin’s style of analysis, and the simple pleasures of warm banana muffins.

After Darin fills us in on his experience and career, he tells us a little bit about how his analysis works. Darin looks for not what the markets are doing, but what is the reason for what they’re doing. What makes them move? 

Kristyn kicks off the conversation by asking Darin how the market and his analysis have changed since he started in this business 30 years ago. Darin said that he believes technical analysis had a much larger role back in the day and has been the biggest thing that he has seen in the industry. We really only have to look for major reversals now because the algorithms are built more on momentum, and take into account millions of factors. 

Another trend that Darin has seen shift has been fundamental data being privatized. In the past 10-15 years, private research firms have started to focus on providing fundamental data, such as acres harvested, that large trading companies are now paying for so they don’t have to rely on the government and the USDA for that information. 

Kristyn then points out the recent price movements within the markets and asks Darin if he thinks it’s noteworthy or normal. Darin thinks that it is definitely unusual and different than what it used to be. While the commodity sector, in general, has gone up, it seems like it’s a relay race where we’re passing on the baton from one market to the next. We’ve seen soybeans, lumber, and copper make huge runs but it hasn’t been the sector as a whole, it’s been different markets at different times - and not the three kings of commodities - corn, gold, and crude oil.  

These movements have occurred because we’ve seen events in the past year that are outside the norm - we don’t often deal with a global pandemic. For instance, lumber demand saw a huge surge because suddenly, everyone wanted to become DIY experts. At the core of it all, it’s been supply issues due to either the pandemic or the impact of weather.

The three then dive into discussing spreads and how they’re used within procurement and the food industry. This episode covered a lot of ground, so make sure to listen to the entire episode on Spotify or in the Apple Podcasts App! While you’re there, don’t forget to subscribe. Also, feel free to reach out to us by email at news@barchart.com with any discussion topics, questions, comments, or overall feedback; Ryan and Kristyn would love to hear from you!